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Redline Comms Inc. (REDL)

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Wednesday 06 December, 2006

Redline Comms Inc.

First Day of Dealings

Redline Communications Inc.
06 December 2006



         NOT FOR PUBLICATION, DISTRIBUTION OR RELEASE IN UNITED STATES,
                           CANADA, JAPAN OR AUSTRALIA

For immediate release                                            6 December 2006


                          REDLINE COMMUNICATIONS, INC.
                  ('Redline' or the 'Company' or the 'Group')

                           First Day Dealings on AIM

           Placing of 13,000,000 common shares at 100 pence per share

LONDON December 6, 2006 - Redline is a leading provider of WiMAX broadband
wireless systems and proprietary wireless infrastructure equipment. The Company
is pleased to announce the successful commencement of trading in its shares on
AIM (ticker: REDL) in conjunction with an institutional placing (the 'Placing')
of 13,000,000 common shares at the issue price of 100 pence per share (the
'Issue Price') undertaken by Canaccord Adams Limited as Nomad and Broker, and by
CIBC World Markets Inc. In connection with the Placing, Canaccord Adams Limited
may, for stabilisation purposes, over-allot common shares up to a maximum of 15
per cent. of the number of common shares offered pursuant to the Placing.

At the Issue Price, the Company has raised £11.32 million (net of expenses)
through the Placing. On Admission and at the Issue Price the market
capitalisation will be approximately £73.07 million (see note 5 below).

Majed Sifri, President and CEO of Redline Communications commented:

'The Company's admission to trading on AIM comes at an exciting time for our
business as we look to capitalise on our strong market position and continue to
expand our geographical footprint into some of the most exciting economies in
the emerging and developing world.'

'We believe that the support shown for Redline is a clear endorsement of the
Group's business model and reinforces our belief that Redline is well positioned
to capture a significant share of the evolving WiMAX market.'


For further details
Redline Communications                             Tel: 00 1 905 479 8344
Tom Hearne, Chief Financial Officer
Carolyn Anderson, Communications Director
[email protected]

Buchanan Communications                            Tel: +44 (0)20 7466 5000
Jeremy Garcia / James Strong / Bobby Morse
[email protected]

Canaccord Adams                                    Tel: +44 (0)20 7050 6500
Neil Johnson / Chris Bowman

About Redline


Redline Communications is the leading provider of standards-based wireless
broadband solutions. Redline's RedMAX(TM) WiMAX Forum Certified(TM) systems and
award-winning RedCONNEX(TM) family of broadband wireless infrastructure products
enable service providers and other network operators to cost-effectively deliver
high-bandwidth services including voice, video and data communications. Redline
is committed to maintaining its wireless industry leadership with the continued
development of WiMAX and other advanced wireless broadband products. With more
than 35,000 installations in 75 countries, and a global network of over 100
partners, Redline's experience and expertise helps service providers,
enterprises and government organizations roll out the services and applications
that drive their business forward.

PLACING STATISTICS

Placing Price                                                    100 pence
Number of shares of Existing Common Stock                        29,502,598
Number of Existing Series A-1 Preferred Stock (1)                10,853,647
Number of shares of Common Stock that would be issued pursuant
to the exchange into Common Stock of all of the Exchangeable
Shares                                                           21,707,294
Number of shares of Common Stock under option or warrant
immediately prior to the Placing (2)                             8,900,253
Fully diluted capital stock immediately prior to the Placing
(3)                                                              60,110,145
Number of Shares of Common Stock being issued by the Company
pursuant to the Placing                                          13,000,000
Number of shares of Common Stock in issue immediately
following Admission (4)                                          64,209,892
Fully diluted capital stock following the Placing (5)            73,110,145
Percentage of Enlarged Capital Stock being placed pursuant to
the Placing (6)                                                  20.25%
Estimated net proceeds of the Placing receivable by the Company  £11.315 million
(7)                                                                
Market capitalisation of the Company at the Placing Price        £73.1 million
following the Placing


Notes:

1. Holders of Series A-1 Preferred Stock also hold an equal number of
Exchangeable Shares of Redline that are each exchangeable into two shares of
Common Stock. See paragraph 2.13 of Part IV for a description of the
Exchangeable Share structure.

2. Assuming the exchange of all outstanding options to purchase shares of
Redline for options to purchase shares of the Company's Common Stock.

3. Assuming the exercise of all of the share options and warrants which have not
lapsed or been cancelled as more particularly described below at paragraph 2 of
Part IV of this document and the exchange into Common Stock of all Exchangeable
Shares on a two for one basis and cancellation of the Series A-1 Preferred
Stock.

4. Assuming that all Placing Shares are issued and the exchange into Common
Stock of all Exchangeable Shares. Upon exchange of the Exchangeable shares, one
share of Series A-1 Preferred Stock is canceled and two shares of Common Stock
are issued in respect of such Exchangeable Share.

5. Fully diluted assumes all Placing Shares are issued, the exercise of all the
share options and warrants which have not lapsed or been cancelled as more
particularly described below at paragraph 2 of Part IV of this document and the
exchange into Common Stock of all Exchangeable Shares on a two for one basis.

6. Stated before the exercise of the share options and warrants more
particularly described below at paragraph 2 of Part IV of this document.

7. The estimated net proceeds receivable by the Company are stated after
deduction of the estimated costs, charges, commissions and expenses payable by
the Company in connection with the Placing.

The shares have not been, nor will be, registered under the United States
Securities Act of 1933, as amended, or any state securities laws and may not be
offered or sold in the United States absent registration or applicable exemption
from the registration requirement of such Act and applicable state securities
laws. This press release shall not constitute an offer to sell or the
solicitation of an offer to buy, nor shall there be any sale of these securities
in any jurisdiction in which such offer, solicitation or sale would be unlawful
prior to qualification under the securities laws of any such jurisdiction. Any
public offering of units to be made in the United States would, if made, be made
by means of a prospectus that could be obtained from the Company that would
contain detailed information about the Company and management as well as
financial statements.




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